A GOP Debt Goes Away

The state Republican Party has quietly eliminated a huge legal bill from contesting the election of Gov. Christine Gregoire.

The Washington State Republican Party has retired its $1 million debt from last year's lawsuit challenging the election of Democratic Gov. Christine Gregoire. As usual with political parties, deep-pocketed donors have bailed out the GOP. In March, the Building Industry Association of Washington (BIAW) paid $235,000, and the Republicans' law firm in the suit, Davis Wright Tremaine, reduced its bill by $276,000—essentially forgiving a good portion of the debt. State Republican Party Chair Diane Tebelius insists that the GOP received no special treatment from the firm. "You should join the real world," Tebelius told Seattle Weekly. "Law firms do that all the time." The Washington State Democratic Party still owes its lawyers $600,000 from that legal battle.

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The Republican candidate in the 2004 gubernatorial campaign was Dino Rossi, a former state senator. His party filed the historic election challenge after three recounts determined that Rossi lost to Gregoire by 129 votes. The Republican case was legally weak from the outset. Chelan County Superior Court Judge John E. Bridges actually ended up awarding more votes to Gregoire at the end of the trial, extending her margin to 133. To make the pain worse, almost six months after Bridges' decision, on Dec. 8, 2005, Davis Wright Tremaine's bill to the GOP was still more than $1 million.

In his final month as GOP party chair, Chris Vance took a run at the debt, making payments from party accounts worth $360,000 and getting fat-cat allies to make payments directly to Davis Wright Tremaine totaling $140,000. Notable contributors were wireless executive John Stanton ($25,000), the Rossi campaign ($75,000), and the Washington Association of Realtors ($20,000). By the end of February, however, the GOP's debt to Davis Wright Tremaine still was $511,210.

In March, the BIAW wrote Davis Wright Tremaine a check for $235,000. Tebelius, who was elected party chair in January, negotiated a reduction in Davis Wright Tremaine's fee of $276,000, and suddenly the million-dollar debt was gone. Tebelius claims that it is not unusual for a law firm to reduce a fee by such a big amount. A Davis Wright Tremaine spokesperson says the firm does not comment on billing matters. (Disclosure: Davis Wright Tremaine represents Seattle Weekly in matters of media law.) University of Washington law professor Sean O'Connor says, "That's a big write-down, but it's not totally unprecedented." O'Connor explains that when clients get a large bill from a firm and feel the charges are excessive, firms do reduce the bill rather than get into a collections dispute with a high-profile client.

The reduction in the bill is not considered a political contribution, according to the state Public Disclosure Commission. Rather, under Washington Administrative Code, Davis Wright Tremaine's fee reduction is called a "donation" and does not have to be listed on the GOP's reports of financial activity.

The debt-retirement is a major achievement for Tebelius, who had a tough campaign to win the race for GOP chair. During the campaign for party chair, Rossi threw his support behind Tebelius' opponent, Chelan's Fredi Simpson. Observers wondered if the state GOP might have trouble uniting after the hard-fought contest. While the BIAW's contribution seems to represent 235,000 votes of confidence in her tenure by a major Rossi ally, the organization would not comment for this story.

The BIAW was the most powerful interest group that backed the Republicans' lawsuit. The organization virulently opposes reasonable environmental regulation and uses millions of dollars from its administration of a state insurance program to support conservative politicians and causes (see "Political Capital," Nov. 17, 2004). The group also has a long history of opposing Gregoire and supporting Rossi. Not only has the BIAW bankrolled Rossi's campaigns, BIAW lobbyists and Rossi actually bought commercial real estate together after Rossi was elected to the state Senate from Issaquah. The BIAW reports that Rossi supported its desired legislation an unbelievable 99 percent of the time as he served nearly two terms. During the gubernatorial recounts and lawsuit, the BIAW worked closely with the Rossi campaign and the GOP, even becoming legal agents at one point.

Washington State Democratic Chair Dwight Pelz says, "The BIAW is a corrupt political organization. Put Dick Cheney, Tim Eyman, and the BIAW in a room and you would have a hard time figuring out who you hate more." (Eyman, of course, is the prominent tax-cut-initiative professional.) Tebelius says of the BIAW's contribution: "We are grateful that small business people are willing to do that."